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Tuesday, October 15, 2013

New study shows why we have to raise the minimum wage to $15 an hour

By Marc Jampole

Your Big Mac and Baconator aren’t as cheap as you think they
are. In fact, every time you bite into a burger or other fast food concoction,
the federal government subsidizes your meal—and the profit made by the fast
food company.

Another study—this one by the National Employment Law
project (NELP)—found that public assistance for fast food workers costs U.S.
taxpayers $3.8 billion a year. That’s a $3.8 billion subsidy to the fast food
industry and denizens of fast food. It’s almost 2% of the total sales of the
U.S. fast food industry, but a much larger portion of the profit. So if senior
management of McDonald’s, Burger King, Wendy’s and Sonic are enjoying their
country club memberships and private pools, they have the U.S. government and
taxpayers to thank.

The NELP study estimates that the average in-store fast food
employee makes $8.94 an hour.That works
out to less than $20,000 per year for someone working 40 hours a week 52 weeks
a year.

I can understand why taxpayers subsidize the development of
alternative energies, oil and gas drilling and university attendance. But why
are we subsidizing an industry that contributes so much to our national health
epidemics of obesity, diabetes and heart disease?

I’m thinking that if we ended this subsidy by raising the
minimum wage to a decent level—say $15 an hour—your burger and fries would
likely cost a little more and that the big fast food purveyors would make a
little less profit. Of course, if fast food cost what it is supposed to cost
without government subsidies, maybe some part of the market for fast food would
opt for healthier and tastier food.While that might lead to healthier Americans, it would definitely lead to
fast food companies making even less money. And we couldn’t have that, could
we?

Could and should.

The argument that raising the minimum wage would lead to job
losses is complete garbage.Employers
tend to only hire when they need someone and when they can demonstrate to themselves
that the additional employee will help to make a lot more money than the new
employee’s salary, benefits and cost to train and equip. Many companies get fat
over time and have to do occasional trimming or purging—but that’s not related
to the minimum wage. These companies didn’t hire additional workers because
they were cheap, but because company management thought they needed them at the
time.

It makes sense that employers like to pay as little as
possible for everything, including labor. But the minimum wage sets a floor on
how low employers can go for public policy reasons: most everyone would agree
that it’s in the best interest of the country to make sure that people who work
will be able to eat and have shelter. With the current minimum wage, far too
many don’t have the basics. It’s time to
raise it.

The call for $15 an hour minimum for all workers is
realistic because over the past 30 years we have allowed the minimum wage to
lose ground against the cost of living and corporate profits. Keeping the
minimum wage low was an integral part of the game plan in the class war against
the middle class and poor that the wealthy began in this country under Reagan.

The first step in returning to a more equitable distribution
of wealth is raising the minimum wage.

You might have to pay more for your hamburger, but fewer of
your tax dollars will go to the public aid programs for the poor that so many
Americans love to hate.

If it weren’t for the entertainment value, I’d be pleased that Texas Governor Rick Perry is foundering in the Republican presidential race. After all, Governor Perry, who is in an unprecedented fourth term as chief executive of the nation's second-largest state, still might get the Republican nomination for president. If that happens there’s no telling what the voters might be fooled into doing. Just look at how far George W. Bush got.